Minnesota Court of Appeals Slams Door on Property Rights

IJ clients Ted and Lauren Dzierzbicki are wondering can the government arbitrarily restrict the property rights of some but not others?

Minneapolis, MN—

Today the Minnesota Court of Appeals upheld a city of Winona ordinance prohibiting more than 30 percent of homes on a city block from being rented. The decision, which was announced this morning, upholds a lower court’s decision on the constitutionality of Winona’s ordinance.

Under the ban, just 30 percent of homeowners on any given city block may be granted permits to rent their homes. The law, which was passed in 2005, forces neighbors to effectively play a game of musical chairs with their homes—some are allowed to “sit down” and rent their property, while others are left standing with an empty house. Whether a homeowner receives a license is just the luck of the draw.

“A man’s home is his castle—and if he wants to rent out his castle, that’s his constitutional right,” said Institute for Justice (IJ) Attorney Anthony Sanders, lead counsel in the case. “Renting a home is a legitimate and historical property right. Today’s decision denies Winona homeowners that fundamental right in violation of the Minnesota Constitution’s guarantee to be secure in one’s property.”

The rental ban exacted a heavy toll on the plaintiffs in this case. All three plaintiffs attempted to sell their homes, but found that not having a rental permit put them at a distinct disadvantage. A real estate appraiser determined that when Ethan Dean, one of the plaintiffs in the case, failed to obtain a rental permit, it reduced the value of his home by more than 20 percent. Faced with mounting financial obligations, and without the ability to rent or sell, Dean subsequently lost his home.

“I may have already lost my home to this unconstitutional law, but I’m not ready to lose this fight.” said Dean. “I am ready to take the fight for my property rights to the Minnesota Supreme Court.”

he case is expected to have statewide implications because a number of other cities have passed similar ordinances to Winona’s. Mankato, Northfield and West Saint Paul now forbid many people from renting their homes. So far these laws are unique to Minnesota, but cities in other states may soon follow the state’s lead.

“When we filed this case we knew the fight for the right to rent your own property would ultimately end up in the state’s highest court,” said IJ Attorney Katelynn McBride. “And that’s where we’re going to go next.”

The homeowners have 30 days to appeal. Following that, the state Supreme Court will likely decide whether to take the case within a few months.